A Company Issues 100,000 Shares of Preferred Stock for $40

Multiple Choice

A company issues 100,000 shares of preferred stock for $40 a share.The stock has fixed annual dividend rate of 5% and a par value of $3 per share.If sufficient dividends are declared,preferred stockholders can anticipate receiving dividends of:

A) $5,000 each year.
B) $15,000 each year.
C) 5% of net income each year.
D) $3 per share.